What Is the 80/20 Rule for Startups?

  • Startup

The 80/20 rule (Pareto principle) suggests that 80% of your results come from 20% of your efforts. In startups; this means identifying which 20% of customers generate 80% of revenue; which 20% of features deliver 80% of value; or which 20% of marketing channels drive 80% of growth. Focus your limited time and resources on that high-impact 20% rather than spreading yourself thin across everything. This applies to hiring; product development; and marketing. Ruthless prioritization is how scrappy startups compete against better-funded competitors.

R&D Offer Quiz

Step 1 of 3

Answer to find out if you're eligible for R&D tax credits.

Do the activities performed relate to a new or improved business component’s function, performance, reliability, quality, or composition?(Required)
For Example: A mid-sized packaging company develops a slightly modified cardboard box design to improve its stacking strength (reliability) for warehouse storage, involving minor adjustments to the corrugation pattern to reduce collapse under standard weight loads.
Is your company trying to discover information to eliminate uncertainty concerning the capability or method for developing or improving a business component?(Required)
For Example: A furniture manufacturer investigates whether a cheaper wood adhesive can hold joints as effectively as the current one during assembly, testing bond strength to resolve doubts about its capability in standard production lines.
Do the activities performed constitute a process of experimentation?(Required)
For Example: An auto parts supplier runs a series of bench tests on different lubricant formulations to find one that reduces friction in engine bearings more effectively, systematically comparing wear rates over simulated operating cycles.